Star is spending RM24.3 million (US$6.4 million) to acquire English and Malay language station Mix Red 104.9FM; and Chinese language station 988 from joint owners Forefront Assets and Rediffusion. Last year 988 made around RM4.4 million and Mix Red 104.9FM lost around RM3 million leading to a combined after-tax profit of RM1.4 million.
"We were looking to make some media acquisitions and for us to go into radio was a logical move, said Richard Ong, Star Publications general manager of corporate affairs. "Radio is an ad medium that is growing and it is an acquisition that doesn't require much money."
Radio advertising accounts for 3.7 per cent of advertising in Malaysia, according to figures from Nielsen Media Research. Ong said: "Growth since then has been quite astonishing. I think there is still room for expansion.
If you look at people's lifestyle; most people listen to radio at home or in the car and Malaysia is a motoring nation."
Malaysia has nine national radio networks that are privately owned. Media conglomerate Astro controls five of them including Era FM, Hitz.FM and MyFM.